Further Aligning Italian Bankruptcy Law To US Ch. 11

Law360, New York (July 20, 2012, 2:03 PM EDT) -- Italian Bankruptcy Law[1] has been extensively reformed in recent years. Until 2005, the Italian bankruptcy system was centered around the idea that failing businesses should be liquidated[2] and insolvent debtors expelled from the market. Therefore, the typical outcome of an insolvency proceeding was the liquidation of the debtor’s assets.

Based on the assumptions that liquidations are inefficient and costly to society, and that reorganizations of failing businesses are a better option so long as there is a going-concern value to be preserved, the Italian Bankruptcy Law...